The FHA offers a lot of benefits on its loans, one such is the refund of your upfront MIP. You can get a refund of up to 80% if you refinance your loan to another FHA loan within 1 month. This percentage decreases with each passing month as per the FHA MIP refund chart.
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📉 FHA MIP Refund Chart
- To qualify, you must refinance your existing FHA loan into another type of FHA loan.
- The current MIP rate for an FHA loan is between 0.50% and 0.75% of the loan value depending if it is less than, equal to, or greater than $726,200..
- You must wait for 7 months from the date of closing of your original loan to apply for a FHA streamline refinance.
What Is an FHA MIP Refund?
FHA loans come with lenient qualification requirements due to which they are the go-to choice of most homebuyers. However, you must pay two types of mortgage insurance premiums when opting for an FHA loan.
- Upfront Mortgage Insurance Premium (UFMIP): The UFMIP is 1.75% of your loan value due at closing. It is a one-time expense and is refundable under certain conditions.
- Annual Mortgage Insurance Premium (MIP): This is your regular payment that you’ve to pay each month along with your mortgage payments.
However, you can get a UFMIP refund if you refinance your FHA loan into another FHA loan within 3 years. The amount of refund depends on how early you refinance. The earlier you refinance the more FHA MIP refunds you get.
FHA MIP Refund Chart 2024
| Months After Closing | MIP Refund | Months After Closing | MIP Refund | Months After Closing | MIP Refund |
| 1 | 80% | 13 | 56% | 25 | 32% |
| 2 | 78% | 14 | 54% | 26 | 30% |
| 3 | 76% | 15 | 52% | 27 | 28% |
| 4 | 74% | 16 | 50% | 28 | 26% |
| 5 | 72% | 17 | 48% | 29 | 24% |
| 6 | 70% | 18 | 46% | 30 | 22% |
| 7 | 68% | 19 | 44% | 31 | 20% |
| 8 | 66% | 20 | 42% | 32 | 18% |
| 9 | 64% | 21 | 40% | 33 | 16% |
| 10 | 62% | 22 | 38% | 34 | 14% |
| 11 | 60% | 23 | 36% | 35 | 12% |
| 12 | 58% | 24 | 34% | 36 | 10% |
How Does an FHA MIP Refund Work?
Your MIP refund depends solely on how long you take to refinance your home. You will get a refund of 58% of your UFMIP if you refinance within 12 months. However, after 3 years this will reduce to 10%.
The FHA doesn’t allow the UFMIP refund in cash. This is why, your MIP refund is adjusted as the upfront MIP payment for your new loan.
What are the Eligibility Requirements for FHA MIP Refund?
Here are the qualification requirements for an FHA MIP Refund.
- Your FHA loan closing date had to be less than three years ago.
- Mortgage payments must be up to date.
- Your credit report must not have any foreclosures.
- To get an MIP refund, you must refinance your loan into an FHA mortgage only.
Bottom Line
You may be eligible for the MIP refund credit, which is applied to your new upfront MIP if you currently have an FHA loan and wish to refinance to the FHA Streamline. However, you must satisfy all the requirements before moving forward with the refinance.
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Can You Get an FHA MIP Refund in Cash?
No, you cannot get your FHA MIP refund in cash. However, you can use it towards the upfront MIP of your next loan.
Can I get rid of MIP on an FHA loan?
Yes, you can refinance your FHA loan into a conventional loan to get rid of an MIP.
What are the latest FHA MIP rules?
As per the latest FHA MIP rules, the premium is reduced to 0.55% from 0.85% for FHA loans.
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